Stock Market Today: Dow Slips Below 17,000 Mark With Little to Re-Energize Rally

NEW YORK ( TheStreet) -- U.S. stocks dropped on Tuesday with little market-moving news to sustain the rally that swept benchmark indices to record highs last week. After smashing through its 17,000-level days earlier, the Dow Jones Industrial Average tumbled below the threshold. The session marked a quiet period between a jam-packed economic calendar last week and the kickoff of the unofficial earnings season after the bell.

Ongoing chatter about an earlier-than-expected rate hike by the Federal Reserve continues to underpin market caution. As nuggets of data out last week pointed to an economy well on the mend, more and more investors are starting to expect that the U.S. central bank must expedite its timetable for scaling back its ultra-loose monetary policy.

At market close, the Dow was down 0.69% to 16,906.62. The S&P 500 retreated 0.7% to 1,963.71. The Nasdaq dumped 1.4% to 4,391.46.

Markets are looking likely to close lower for their second day in a row after cresting highs days earlier, a move which Raymond James analyst Jeffrey Saut notes is similar to a trend seen in the summer of 2011, a period that suffered a 18% decline.

"While I do not think any pullback from here will be that severe, I do think we are vulnerable to a 10%-12% decline in the weeks ahead, albeit within the construct of a secular bull market that has years left to run," Saut wrote in a note.

Second-quarter earnings season unofficially began Tuesday after the markets closed with the announcement of Alcoa's (AA) results. The aluminum maker reported second-quarter earnings of 18 cents a share, 6 cents higher than analysts surveyed by Thomson Reuters expected. 

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